What is a resolution type and what may happen if the incorrect one is used?
Many body corporate decisions have to be made at a general meeting and in doing so the motion must state what type of resolution type is needed to determine the way in which a result is calculated. There are four different types of resolutions in QLD and in some cases the legislation will dictate what resolution type is required, however If the incorrect resolution type is used, this can result in the motions being invalid and the Commissioner’s Office being involved.
To avoid having an application through the Commissioners Office being lodged and the potential of an order declaring a motion void, it is important to ensure that correct process is followed – including the correct motion type.
In this months adjudicators order, we review the ramifications of an incorrect resolution type at a General Meeting.
The application was made by a lot owner against the Body Corporate seeking an order that a motion carried at an EGM held in 2021 be declared void. The motion being to record a new community management statement (CMS) changing the areas of common property allocated to lot owners as car parks.
The adjudicator advised, in the order, that the motion proposed at the meeting was stated as requiring an ordinary resolution, however a Body Corporate consent to the recording of a new CMS must generally be in the form of a resolution without dissent. A special resolution is sufficient if the CMS only changed the by-laws, but not if they are exclusive use by-laws.
Section 62 of the Body Corporate and Community Management Act 1997 states:
“(1)This section provides for the form of the consent of the body corporate for a community titles scheme to the recording of a new community management statement for the scheme in the place of the existing statement for the scheme.
(2)The consent must be in the form of a resolution without dissent.
(3)However, the consent may be in the form of a special resolution if the difference between the existing statement and the new statement is limited to the following—
(a)differences in the by-laws (other than a difference in exclusive use by-laws);
(b)the identification of a different regulation module to apply to the scheme.”
Because of the error in the resolution type, the adjudicator ruled the motion void.
The full order can be read here.
More information can also be obtained on the Commissioners Office website.
It is important to note that the adjudicators orders that we review each month are made on a case by case basis by the commissioners office based on the applications, submissions, by laws pertaining to each of the schemes, legislation that is applicable and are not a fit all order.